Early termination of rental contract

Candace WebbUpdated March 23, 2017

Signing a rental agreement or lease gives a landlord your word that you intend to remain in the rental property for the term of the agreement. Rental agreements are legally binding documents and, therefore, difficult to break. However, there are a few ways to effect the early termination of a rental agreement. Breaking the agreement without valid reason can be costly and have a negative impact on your credit rating.

Laws Vary by State

It is important to check the most current laws in your state regarding early lease termination. Each state sets guidelines about when a lease can be broken before it has expired. Typically, the boundaries include health and safety concerns if you remain on the property. Issues such as non-working heat or lack of running water are usually valid reasons to break a lease if the landlord does not provide prompt repairs.

Buy-out

Many landlords include a buy-out option in which the tenant can break the lease if desired. A buy-out option provides a dollar value to be paid to the landlord in the event you wish to break your lease and vacate the property. Costs range from one to three months rent. This clause works well for tenants who are transferred on the job, decide to marry and move or purchase their own home. Check your lease before signing to be sure there is a buy-out clause, as after signing it will be too late. If there is no buy-out clause, it doesn't hurt to ask the landlord to include one.

Agree to Disagree

Sometimes a landlord will agree to let you break the lease. If you have a valid reason such as an out-of-state job transfer and you live in an area where vacancies are quickly filled, your landlord might decide to just let you out of the lease. The best approach to any lease-breaking attempt is honesty. Telling the landlord in writing that you wish to break the lease, the reason and the time frame in which you will vacate the property presents your case in a professional, calm manner.

Lack of Livability

If the property becomes inhabitable due to no fault of your own, you may have legal grounds to break the lease. Heating systems failing, plumbing issues that eliminate the property's running water and holes in the roof that allow weather elements in large amounts to enter the home are examples of a home lacking livability. You have a duty to report such issues to the landlord as soon as you know of the problem; however, once you have reported it, if the landlord fails to remedy the situation in a reasonable time frame you can notify him of your intention to break the lease. He may refuse to allow it. He may take you to court, or he may let you move without a problem, knowing that he failed to provide legally required elements in his rental property. An attorney who specialises in landlord/tenant issues can advise you about what grounds constitute reason to terminate a lease based on livability standards.

Warning

When none of the allowable early termination reasons are present and your landlord does not agree to let you out of the lease, breaking the lease can be costly. The landlord must make a reasonable attempt to re-rent the property as soon as possible after you have vacated, but he can sue you for any damages including the time between your leaving and the new tenant coming in. In addition, you can be ordered to pay all court and attorney fees for the action.

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About the Author

Candace Webb has been writing professionally since 1989. She has worked as a full-time journalist as well as contributed to metropolitan newspapers including the "Tennessean." She has also worked on staff as an associate editor at the "Nashville Parent" magazine. Webb holds a Bachelor of Arts in journalism with a minor in business from San Jose State University.